WILEY The most important element in becoming a successful trader is having a sound background from which to trade, con- sisting of a strong base of acquired knowledge derived from being active in the markets through time. Building this background is in some ways the easiest and in other ways the most difficult thing for a trader to accomplish. Trading experiences, observations of all kinds, a focus on what is most important and a clear understanding of business prin- ciples —all are necessary ingredients in a strong trading background. Awareness and patience are the requirements for developing it. Without a sound background, your trad- ing cannot be consistently successful. With it, you can de- velop clear, correct ways of thinking and confidence in your trading judgment. In today's fast-moving world, some traders try to bypass the crucial first step of developing a sound background, and then rationalize the lack of background for the rest of their careers. But the opportunity to develop the needed background is always there. Td like to share with you the background that underlies my own understanding of the markets. The experiences that went into building it are varied and demanded a lot of time and hard work. If you can learn the principles that these experiences illustrate, you'll find that the same prin- stekraM no reyamldietS t**., snosseL 'hraE \ kniht I .redart a sä secneirepxe nwo ruoy ni erugif selpic 's^' and go forward." My parents didn't criticize or analyze the .stekram s'yadot tuoba sgniht emos nrael osla ll'uoy ehT .nwo ruo no taht did eW .edam syob ew sekatsim bürden of facing up to our mistakes and learning from each experience was on our shoulders, no one eise's. TRUST AND FREEDOM Patience was always stressed because it reflected and detcepxe t'nerew eW .ecnedifnoc-fles renni ruo depoleved dna wolS" taht dootsrednu saw ti ;stluser kciuq wohs ot In my formative years, from 1944 until I completed high ekat ot em degaruocne stnerap yM ".ecar eht sniw ydaets .egdelwonk dna noitacude htob deniag I ,6591 ni loohcs my time to find a field that I enjoyed rather than one they tub ,gninrael rof dohtem dna tamroF a sedivorp noitacudE would like me to pursue. The object was to do things and fo tol a ,suhT .ecneirepxe hguorht semoc egdelwonk to find out what I could and couldn't do — then I'd be able knowledge develops on a subconscious level. I was not to make choices for the future. saw I nehw ssecorp gninrael suoicsnocbus siht fo erawa Later I learned about the American Indian practice of growing up, but in later years I found that I had a large putting a young man of eleven or twelve years old out alone doog a niag ot redro ni no ward ot egdelwonk fo esuoherots syad lareves dneps ot tresed eht ni ro potniatnuom a no -nocbus ym ni derots dah I .tcejbus yna fo gnidnatsrednu thgim noitalever ehT .efil sih fo gninaem eht rof gnihcraes deirav morf emac taht egdelwonk laer fo esab atad a suoics experiences. come through a sign, or perhaps through a dream; either desiar saw I .htap denitsed s'nam gnuoy eht laever thgim I grew up on a ranch in California, where much of my in the same spirit, and it has become an important part of early learning came from being exposed to the family busi- my background äs a trader. Today I enjoy the same free- ness. Skill was greatly respected in my family, but more dom to search and continually reevaluate my life's goals. -sid saw ohw nosrep A .ytirgetni saw lliks naht tnatropmi a dna erutnev dluoc ew hcihw morf esab a saw emoH loyal, dishonest or untrustworthy wasn't needed, no matter sanctuary to which we could always return. My parents gniod saw ylimaf ym enoemos fI .eb thgim eh delliks woh assured us that we would always be welcome to stay with business with turned out to be untrustworthy, we stopped -er erew ew tuB .erew sgniht dab woh rettam on meht eht gnidrawer woh rettam on ,mih htiw ssenisub gniod eht ot dna su gnidnuorrus esoht ot ,sevlesruo ot elbisnops desu eW .sisab etaidemmi na no eb ot raeppa thgim laed community. If we ever violated that trust, we might lose I dna ,erutuf eht ni sessol rojam diova ot elpicnirp siht our sanctuary. .yad siht ot elpicnirp siht yb kcits degaruocne erew eW .yraropmet sä deweiv saw sseccuS -sim gnikam rof denmednoc saw eno on ,ylimaf ym nI -ed oot ro llew tnew sgniht nehw deticxe oot teg ot ton -kam morf emac egdelwonk lla taht dootsrednu eW .sekat ni yllanoitome niamer ot tub ,t'ndid sgniht nehw desserp tuo derutnev I sä tnanimod emaceb aedi sihT .sekatsim gni balance. Time was the most important measurement of all. a saw tahT" .yllanoisacco depmub tog dna dlrow eht otni A person or an idea had to stand the test of time. New good experience," my parents would say. "Learn from it t'ndid yeht fi neve ,dedragersid ton erew smaerd dna saedi .4. willingness to follow through on a task marks the difference between those who are almost successful and those who .slaog rieht eveihca In my family, we also learned to recognize the abilities ETAG EHT GNIXIF FO ECNATROPMI EHT ,uoy naht tnelat erom evah syawla elpoep emoS .srehto fo some less. Don't compete outside yourself; try to be the morf nrael tuB .seitiliba nwo ruoy nihtiw nac uoy tseb yawa nur ot ton denrael I ,rehtaf ym rof dekrow I nehW observing yourself and the many types of people around from a problem and to finish what I started. Our philoso- you. no evom neht ;thgir ti od dna ,ecno boJ eht od ot saw yhp to the next one. My father never understood why people would fall to recognize a problem or, if they did, why they ynam dah eW .os od ot decrof litnu ti htiw laed t'ndluow yeht emit ot emit morf dna ,hcnar ruo no setag nedoow LORTNOC DNA REDRO FO STERCES EHT would need repair. When our ranch hands went through a broken gate, they would open and close it without stop- rehtaf ym ,dlo sraey neves saw I nehw ,6491 tsuguA nI ping to fix it. By contrast, my father would fix the gate .yaw sih saw tahT .ereht dna neht ruo ot hcnar yellav ruo morf rotcart a gnivom erew I dna ruof dnuora sllihtoof eht dehcaer ew sA .adaveN ni hcnar -dart eht ,9691 ni degnahc stekram eht nehw ,retal sraeY in the afternoon, about four hours from our destination, saw ti— dekrow regnol on depoleved dah I dohtem gni ,ellivrO ni pohs erit a ta deppots dna erit talf a tog ew ,yad yreve stekram eht ni gnidart saw I hguohtlA ".nekorb" California. ecnO .etag nekorb eht fo ytilaer eht ecaf ot tnaw t'ndid I In those days, truck tires were complicated to take apart tsuj ,melborp eht morf yawa gninnur saw I taht dezilaer I erew yeht evif ot net tuoba ta os ,rehtegot kcab tup dna -itom I ,etag nekorb eht derongi dah sdnah hcnar eht sä .melborp eht tcerroc dna pots ot flesym detav still working on it. My father was anxious to get on with htob os ,evif ta krow tiuq ot detnaw cinahcem ehT .pirt eht I also learned from my father the importance of the last eht ekat meht dehctaw I .enod boJ eht teg ot detnaw nem eht saw siht taht dias syawla eH .boJ yna fo tnecrep 01 -ome ,niaga dna niaga rehtegot ti tup ot gniyrt trapa erit most important part of any task—the part that required ta gniraews dna remmah a htiw erit eht ta gnitaeb yllanoit the greatest discipline. This final effort separates success kcab erit eht tup uoy t'nod yhW" ,pu depip I ,yllaniF .ti net sah syawla ohw nosrep eht setarapes ti ;eruliaf morf "?trapa ti koot uoy yaw etisoppo eht rehtegot yllufsseccus ohw nosrep eht morf enod tnecrep 09 stcejorp finishes each task; it separates the many climbers who reach I can still see the mechanic's face äs he turned his head the 25,000-foot level on Everest from the few who reach dna— taews dna trid htiw derevoc ecaf sih— em drawot said, "Well, how is that, sonny?" I proceeded to teil him the summit. The same philosophy applies to trading. The how, and five minutes later we were on our way. Steidlmayer on Markets snoss£t ylraE I learned that by watching you can perceive a sense of I couldn't hang on because there was no place to grip on -bo ;stluser ecudkorcp tu'nordt e cenehitatp mfif dona sgnonitoimllEa .rfe drfolesym derutcip I .reliart eht fo kcab eht dluow I ,liefse rIva tfioin taandh utn deeersstan ddilnug odco. II've .fdouanodr th ey skacmoe rto ebeht otno .gnidart ni eurt probably break my arms and possibly die. I panicked. I When working the land, thdeadr eym w tuabs ,kprraibd oet niang etbh seg odd iefhfte drnea n,mtaercs ot detrats chores we were given. A Job had to be done according to couldn't hear over the noise of the pickup and the rattle Standards that were acceptable to our parents and to the of the bounding trailer. sdradnatS nwo ruo teem ot dah ti ,yltnatropmi eroM .hcnar Fortunately, I figured out a way to avoid disaster. By first, before we even showed anyone the completed Job. lifting my body off the truck with my arms and tilting my In my family, your Job was you —a reflection of your Stan- eht brosba ot elba saw I ,daeh ym sdrawot kcab thgiew dards. yaw taht edor I .ecnalab ym peek dna smra ym ni ecnuob The full-time ranch workers did a good Job with the cash- for about three-quarters of a mile, until we got to the shop. flow crops, but not äs well wdi'tIh h gtuhoeh tlfai l,elc-ninei rJepoxbes s,i hwt thuoicbah rekhetapft ym dlot reven I them occupied during sla.crket staismide tpse. ccOa noet toonf dtehneraseel JIo .tbi sy bw daersacs yllaer neeb irrigating the back pasture. The back pasture wasn't lev- In this episode I fought off disaster with my brains and my -ri erew uoy fI .ti ssorca retaw teg t'ndluoc uoy os ,delle muscles and I gained confidence in my own abilities äs a level no detnalp saw hcihw ,porc nroc a ro naeb a gnitagir result. ground, you were expected to make sure water got over every inch. But everybody slacked off on the fill-in Jobs because no one ever checked them. LOOKING BEYO ESNHETDL F But when I was asked to irrigate the back pasture, I designed a system of dams to get water all over the field, reve eno oN .detagirri ylluf neeb erofeb reven dah hcihw tnuh ot detnaw I ,nevele tuoba saw I nehw ,yadrutaS enO tuo noitcafsitas lanosrep tog I ;rettam t'ndid taht tub ,wenk dna ,dniw htuos gnorts a htiw yad yniar a saw tI .skcud detpecca eht nihtiw deyats I fi taht dezilaer I .ti gniod fo -htorb yM .hcnar eht revo lla eseeg dna skcud erew ereht yB .gnihtyna nrael t'ndluow I ,boJ eht rof sdradnatS ers and I had to move about 1,500 sheep from one ranch stretching myself beyond the Standards, forcing myself to to another before I could go hunting. My father warned do more, I learned a lot. ew sä tuB .peehs eht htiw sdleif eht ssorca tuc ot ton em Another expergiennitcneu hta uoggh ott m sueo tiox nhaa veero cmo ndfniade enrcoem i nw emrgy I ,dedeecorp abilities and to take control of a Situation. I was riding with because we were passing right by the ducks and geese. saw dad ym taht reliart a fo egde kcab eht no sgod ruo Finally, I told my brothers that we should take the sheep pulling behind the pickup truck. We were moving down across the field to get to the other ranch faster. As we a rugged road at about 25 miles an hour. Suddenly, the approached the middle of the field, about 150 sheep got trailer hit a bumpy Stretch of the road, and I realized that stuck in the mud. Now, if you can image a sheep up to •8« .9. IF" stekraM no reyamldietS her belly in mud, with her wool füll of mud — each weigh- he'd check off the list when he got to the counter to make ing more than I did —and multiply that by 150, you can .llib eht pu gnidda ni sekatsim yna ekam t'ndid yeht erus imagine what we were dealing with. desu emos gniyub fo noitpO eht dah rehtaf ym nehW tub ,syadrutaS no noon ta ffo tog sdnah hcnar eht llA farm equipment, he behaved just äs the ranch workers did not that week. Everyone worked until 3 P.M. that day, when they were buying a used car. If the car was under- evom ot llams oot saw I — dum eht fo tuo peehs gnillup yeht ,deulavrevo saw ti fi ;ti yub dluow yeht ,deulav them myself. No one complained, but I realized that my uoY" ,yas dluow rehtaf ym ,selas elttac eht tA .t'ndluow .krow artxe fo tol a elpoep fo tol a nevig dah tseretni hsifles can make a lot of money just being a sharp buyer. But if .tsrif flesym tup ot ton denrael I ecneirepxe taht morF taht denrael I ".kcab ti teg ot yaw on s'ereht ,yaprevo uoy .ssenhsiflesnu seriuqer osla gnidart ni sseccus ,em oT if you buy something over value, time is against you; but rehto ot noitagilbO na evah uoy ,tip eht ni er'uoy nehW eht emaceb sihT .edis ruoy no si emit ,yaprednu uoy fi traders and brokers in the pit to contribute to the well- .seitidommoc gnidart ot hcaorppa ym fo gninniprednu being of the marketplace, not just to seek your own profit. shtnom xis :ytreporp gniyub ni elur eno dah rehtaf yM laudividni rehto yna ro uoy erofeb semoc ecalptekram ehT or a year after you buy the property, your neighbor should trader. -aem sih saw tahT .ti rof diap uoy tahw yap ot gnilliw eb eno tub ,nam citsimitpo na saw eH .eulav fo tnemerus imprinted by the experience of the Depression. Although ni taht ees dluoc eh ,tbed diova ot yaw sih fo tuo tnew eh KROW TA STEKRAM FO SESPMILG -cen ti gnikam ,gnignahc erew seulav dlrow rawtsop eht fo sucof eht taht wenk eH .ylsuoiciduj tbed esu ot yrasse srac dna snug desu ni gnidart sdnah hcnar eht gnivresbO dnal no tub ,snoitarepo yliad no eb ton dluohs hcnar eht and my father trading in land, equipment, and crop mar- acquisitions. So he would never borrow to finance daily naht rehtar snoitautis fo egatnavda ekat ot em thguat stek .dnal yub ot tiderc esu dluow eh tub ,snoitarepo ym ,emit tsevrah tA .em fo egatnavda ekat meht gnittel ,semarf emit tnereffid dah rehtaf ym ,ytreporp gniyub nI father wasn't speculating for big gains. He wanted a fair different needs and different motives, depending on the sih rof tiforp lamron a ekam ot redro ni porc sih rof ecirp Situation. He once planned to buy a ranch with his brothers work and his capital investment. If the price at harvest at an auction. It was a sealed bid auction, at which every- .niarg eht derots dna dleh eh ,ton fi ;dlos eh ,riaf saw emit body had the right to raise the bid 10 percent. On our way When buying, my father wanted a fair price äs well. I ereht elpoep rehto eht taht em dlot eh ,noitcua eht ot remember going with my father shopping to buy all the would have more money than he did, and that he would groceries for the camp. He knew the price of everything, have to scare them out of the trade if he hoped to get the and he always bought sale items. If the price was too high land. To do so, he bid a lot higher than what people thought he wouldn't buy; he would substitute or go without. He -retfa yna eb t'ndluow ereht taht os ,htrow saw dnal eht dna ,tsoc dluohs meti hcae thguoht eh tahw fo tsil a dah .sdiber noitcua • 10- 11 •— stekraM no reyamldietS t hcaeW hhceano rhpisp bai do wt assy aanwno utnnceerde, faf ihdu sehr efewil oevreerh tht e, lcarouwddi.vidni eht Many of the Farmers in the area told my father that they market applying the same principles of value to different would seil him their land at that price. No one eise tried conditions. to raise the bid, and my father accomplished his goal. There was a wool buy er who came up from Stockton, This is one thing that a good broker or trader does. Many California to buy the tag ends of the pelts and the wool times ythreevy eu staeh at hdiegchietor nth raenh ntaofr myMal p .rgicnei rtaoe hastt rtaac td tlroasd -t'nsaw taht .pu kcip dluow teekrsr, aremaliz inlgo tohwat in e thhe tsh o,prt uter me mtheay cwe rree oyveurpbay iengh; t emit but within a half, dheonuiarl poxre a .nS .hrMou rd,n ath ,saith tp truicoeb aw reoyuulbd lbooew a eht deksa eH good one. gnilkni tsrif eht saw sihT ".rof ssenisub ni m'I tahw s'tahT" In another instance, my father acquired a piece of prop- I had that markets could be read and understood. erty by playing a waiting game. He feit that nobody eise My father was aware that Mr. S. had a deadline from was going to buy thyel npor oevpietcraty s,a wso te khrea mh alodo wpl eehnTty .g onift atriempoe .saw eh hcihw The attorney for the estate dickered over the price for a a couple of times a year. If my father didn't seil his wool -roppyoea er hantd sas ihmalf, dbluut omwy feahthe ,re knnielwd atehadt tehhe te sntaithe thiawd t.oS .rM ot seil it. He gambled on the chance that no one e.rMi sfoe yc newuqerfo ehut talhdt deciton osla eH .lies ot ytinut 04 tuoba rof ytreporp eht tog eH .now eh dna ,ti yub S.'s phone calls and visits would increase äs his deadline -er eht ,niagA .ecirp gniksa lanigiro eht naht ssel tnecrep approached. s'reyub eht ot dna eulav ot snoitidnoc tekram fo pihsnoital eht gnola snooccar dna sknuks part ot desu rehtaf yM .lacitirc saw sdeen s'relles dna river, dry the pelts, and seil them for Christmas money. The point is this: My father was always prepared, and Mr. S. would come up to our ranch in November and pay he always had a game plan. When he started ranymc theg iotn regdae l bssoal ac säk ,stlep yttar eseht rof ecirp gib a in 1916, he knew what he was going to buy and how he dad in a good mood. He would also make a low offer for ecneitap eht dah eh dna ;nalp sih hsilpmocca ot gniog saw dluow dad yM .raey eht ni retal deraehs eb ot loow eht to do it over time. He knew when to move quickly and naturally refuse to seil the wool at this low price. when to move slowly. I was always after him to buy other rehgih a htiw os ro htnom a ni niaga llac dluow .S .rM tuB .nalp emag sih edistuo erew taht ytreporp fo seceip price and would continue to call more and more frequently he never would. He always refused to buy marginal prop- until the deal was struck. I watched my father play his erties because he feit that he should never buy anything eht tsniaga ffo tcatnoc fo ycneuqerf dna secirp tnereffid .doog gnihtyna lies ro dab siht nI .tekram evitca na ni loow eht gnilles rof enildaed My father explained these ideas to me, and although I way, an amicable deal in which both people made money I ,nwo ym fo secneirepxe tekram suoiverp on dah dah was eventually struck. In fact, my father always said that began to see the difference between buying a used car, both sides had to make money for any deal to succeed. esehT .sporc gnilles ro dnal fo eceip a gniyub ,nug a gniyub rehto yna ro peehs ,elttac ,loow dlos rehtaf ym revenehW were all different markets, and depending on the needs of commodity, he feit that the information about the sale was •12« •13- Steidlmayer on Markets snosseL ylraE between him and the buyer, and that others who might but we had never received any payment for this. To com- b.ee irncteare setedh hta dr onof r ig0h0t t0o ,t1he$ In dfoermtantiaonw. S oe Iw lea r,needtasnep noitamrofnI tnatropmi erom si atad lanoitcasnart taht ylrae The representative said he would talk to his home office in any market than nominal quotes. (Nominal quotes ehta detpreccea eh ,retal syad ruof ro eerhT .wonk su tel dna laed d na adibof fdere ptariecrecs, drenpare bseonJti ndg eoht goegne raa l epnaoradm edtaerhs I taht tief I .laed of what a price could be, not necpue dsesdaneri ylnyap mcooCn rfeiwromp eehdT .sbedyis ahtnob ot riaf saw taht hcum si noitcasnart laer a morf ataD .noiftoc adsaneatsrnti l0a0u0t,c3a$ edam rehtom ym ;sraey eerht rof gniyats uoy ,ecalptekram eht ni evitca gnieb yB ).lufgninaem erom .noissimmoc tnecrep 5 a tog I dna ,522$ gain Information. This has held true throughout my trading To my father, $75 cash represented real value, while I -rofni erom eht ,redart a sä ma I evitca erom ehT .reerac could see that the value of the land to the power Company mation I have in my hand. representative far exceeded $1,000. He needed to be close I nehw derrucco dnal gnivlovni laed ssenisub ylno yM elihw ytreporp hgih eht esu ot elba eb ot dna daor eht ot fo strikstuo eht no serca net dah rehtom yM .neetxis saw the rest of the county was flooded in the winter. So the dluow tiforp gnimraf lamron a hcihw no ,ainrofilaC ,asuloC market worked in this case to find a fair price. It moved be about $20 an acre per year. But the parcel was too small up quickly from $75 to $1,000 because it was way under- to be worth farming. valued at $75. eht ssorca enilrewop a nur ot tcartnoc a htiw ynapmoC A t'nod ew ;000,1$ ta deulavrednu neeb evah yam osla tI a sä 02 yawhgiH ot txen dnuorg hgih siht detnaw yellav know because thee was no other comparable reference point. storage area for its trucks, towers, and equipment because I didn't ask a price high enough to evoke a lower counter- ni retaw htiw dedoolf saw ytnuoc eht fo tser eht fo hcum eht rehtehw erus rof wonk t'nod ew yad siht ot oS .reffo eht fo erca eno rof latner 57$ su dereffo yehT .retniw eht $1,000 price was really a good deal or not. I was satisfied ,reffo doog a saw taht thguoht rehtom yM .raey a rof lecrap at the time, but maybe I could have done better. dad ym rebmemer I .000,1$ reh teg dluoc I dias I tub daeha teg ot tluciffid yrev s'ti taht deveileb rehtaf yM s,57$i erus a egkat nacn uoY .irehthoM ,ectiohc r uoyn s'tI" ,igniyaas m eht taht dias syawla eH .lufsseccus eb dna yalP .em".000,1$ fo esiimortp s'ete P ekfat naco uoy ro doirep gnol a revo doog yltnetsisnoc eb ot tem I .em htiw og ot dediced rehtom ym ,yad txen ehT the compound interest game; build your base slowly and the power Company representative in the afternoon and surely. A small increase on a big base is better than a big denialpxe I .seitreporp ralimis rof tog ew tahw mih dlot move on no base. dna ytreporp eht morf ssorca sdnuorgriaf erew ereht taht eht ni niw uoy taht erus ekam ot si ssenisub ni yek ehT elba eb t'ndluow ew ,ynapmoC sih ot ti detner ew fi taht long run and that you can sustain yourself on the down to get the parking revenues we usually received. This was side. If you can handle the downs, you'll always be suc- elpicnai rsplig hetm exaasg gseirhatTion ..y Aro feaihr tw ass'r heehldta efv eyrym y esaar wacr otassh tth—e lufssec ,emit taht ta ytreporp ruo no krap did elpoep dna ,daor has worked äs part of my trading strategy. 14 15 Steidlmayer on Markets My mother was more of a general guide for me. She would say, "Go out and do things. You can't learn without experience." Her point was that when you go beyond your -emmi lufsseccus eb ot gniog ton er'uoy ,esab egdelwonk diately, but you will gain experience that expands your base and ultimately propels you forward. -rus saw I ,esie enoyreve ekil ,taht ezilaer ot emac I ,ylimaf ym ot esolc em tpek taht elbbub gib a yb dednuor my economic base and my community. I became con- In 1957, I decided to go to College. I wanted to break with vinced that I had to move outside that bubble to be suc- the strong social tradition that you had to go to College to I tub ,seulav sti dna ytinummoc ym detcepser I .lufssec ni rojam gnitnuocca na sä dellorne yllanif I tuB .sgniht od fo snoitaripsa dna slaog eht morf trapa flesym tes ot dah the University of California at Berkeley because I wanted others. This realization set the stage for the next phase of taht wenk ydaerla I .ekil saw egelloC tahw flesym rof ees ot my development. I wasn't going to work for anybody eise, and that the grades ot ecnereffid hcum ekam ot gniog t'nerew loohcs ni tog I me; I just wanted the experience of College. If I found that .yats ot gniog t'nsaw I ,em rof ereht tifeneb on saw ereht As far äs I was concerned there would be no stigma about leaving. THE MARKETS BECKON My first awareness of any organized markets came at ni noissecer a saw erehT .8591 dna 7591 gnirud yelekreB fo sdneirF .gniyllar erew secirp kcots tub ,ymonoce eht mine were doing quite well with their stock holdings, and I .tekram eht hctaw ot detrats dna deugirtni emaceb I tahw dna stsacerof cimonoce neewteb tsartnoc eht deciton .deneppah yllautca I believe it was in the spring of 1958 that an article appeared in Fortune magazine about a father and son team •17- 16 stekraM no reyamldietS of commodity traders. They started out with $10,000 and could the 6.50 price allow me to repay my bank loan. I ,hcnyL llirreM hguorht gnidart noillim a naht erom edam ended up with nothing for myself. before losing oatl mpuos ot gal ml oefh itt daenhdc teanwdi nIg , 0u5p. 6w tiath s na atewbe nehtyt- dlos I retfA I .snoissimmoc retfa tiforp rallod dnasuoht ytriht ro evif about 14 by the following April or May. I was very fortun- was amazed that so much money could be made in a short ate that I hadn't had much money to lose. I'd been able daer ot nageb I os ,esab gnitrats llams a hcus morf emit eht ni elpoep fo tol a hcihw ,orez ta sessol ym pots ot about the commodity markets, follow them and ask peopl.eod t'nac ssenisub seitidommoc .meht tuoba ekil secneirepxe hguorht og sredart ytidommoc yna M snaebyos ,taehw ,nroc gnidart no snoitadnemmocer tog I the one I had that summer. My plan had been based on a and soybean oil from various brokerage houses. I started totally unrealistic idea — a set of dreams and hopes rather trading, but I was unsuccessful. In fact, I inherited $500 than facts. When a trade is developed this way, you are dna ,evom ehfrto mfo m ym goratntdofabth eer,h wth ot adi etdi a tt itxhee a goe to fd 99e,c arnod fI lyosltlareneg rehtafdnarg ym koot tI .gnirebos saw tahT .yad eno ni lla ti you are unable to take advantage of any price rise that -roF .yad a ni ti welb I dna ,yenom taht evas ot sraey 99 uoy tub ,thgir neeb evah yllaer yam edart ruoY .swollof tutin altleulpy, oI td eidnni'ltp hiacvsei da ndyn ma oerce nmeoirneepyx teo l,oesged. eInlw faocntk, i neht dekcal all my early learning experiences, my trading stake was off. trap siht oS .srallod derdnuh xis ro evif naht erom reven .evisnepxe t'nsaw noitacude ym fo selcnu ym dna rehtaf ym ,8591 fo remmus eht gniruD DISCOVERING THE BELL CURVE -elbuod emos mraf dluoc I dna snisuoc ym taht dediced crop land (wheat followed by beans) and use the earnings to fund our College educations. I had a dream that by plant- I had my first awakening in the spring of 1958, when I rebotcO ni ti gnitsevrah dna enuJ fo dne eht ta porc eht gni took a statistics course at Berkeley and was introduced to I was going to megaakpe e $h2t 5re,0b0m0e. mTeor dlloit st hIi s.e, vervucer lylethbi neght hfaod tpecnoc eht .ecirp hgih a dna porc gib a deen d'I — yltcefrep krow ot ,evruc lleb eht hguorht taht dias ti erehw koobtxet eht fo As the susmihmTe .rr epdrroog criemssseodc, luI fiktuepaet br eaf siegmuroicn gso amhyc tenxe-rappa fo tuo detcepxe ym gnirewol tpek I dna ,seunever ym dna sesnep hit home because I knew that my trading observations and taht derugif I nehW .000,01$ dna ,000,51$ ot nwod-tiforp experiences up to this time lacked a sense of order. I began it was only $6,000ci,t1o ahhacr yvlegsntiemde tehse e hbte faon nso aitnazdi ngaogtr oa erhota edzsiiladuesiv ot gniyrt bid of 10 cents a pound. I laughed at theeno ybrevied t ahatn sodah c sehat—id st ipt hytiadotmmoc eht ni ytivitca raey eht ta dedart dah snaeb ecirp eht ,stnec 71 detnaw I eht fo erutcurts eht nihtiw— ylgninoitseuqnu detpecca esie 52.01 morf tnew ecirp eht sä dehctaw I ,daetsnI .erofeb bell curve. My Job, I decided, would be to find a way to to 10 to 9.75, and so ,odens,n edso Iw ,env riunc 2lle5b-c eehntt d ninac ,rseoamhce ntathst toot redro gnirb dleiy doog a dah dah I esuaceb ylnO .rebmeceD ni 05.6 would be the way. •18« •19-